The mutual impact of organizational culture and structure

Module 4 - Case

Organizational Structure and Culture

Assignment Overview

The format of this case differs from the previous three modules and resembles more closely the format of assignments you will see in many of your courses going forward. This is not to say that you should abandon what you have learned about the analytical process of alternating between the abstract and the concrete, the reflective and the active, but this paper will not follow the format of a section on concrete experience, reflective observation, abstract conceptualization, and active experimentation. Each of these aspects of analysis should be present, but integrated into the paper as a whole, rather than broken out into distinct sections.

The topic of this case is organizational design. To complete this assignment, we will begin as before, and you should identify an organization you know very well. Then conduct your analysis by addressing the topics below. Do not line up the questions and address them one at a time as in a short-answer test, but rather integrate them into a single coherent commentary and analysis of the organization. A critical part of successful completion of this assignment is for you to demonstrate your ability to employ the concepts introduced in the background material in describing and evaluating the effectiveness of the organizational design. To do this, you will need to draw on the concepts from at least three readings/videos. This paper should be 4-6 pages long.

Case Questions:

1. Diagram the formal structure of your organization. Identify the various management positions or titles on the chart and indicate the positions/jobs that would report to each. Identify the various management positions or titles on the chart and indicate the positions/jobs that would report to each. SmartDraw.com ( https://cloud.smartdraw.com/ ) provides free examples, though others are also available via Google. PowerPoint also has templates for organizational charts you can use.

2. Describe how work is divided (specialization and departmentalization), coordinated (chain of command and span of control), and controlled (centralization and formalization). Is the structure more mechanistic or organic?

3. Describe the informal structure of the organization. How does work actually get done?

4. How does the organization deal with the differentiation-integration issue?

5. Having completed this analysis, identify three strengths and three weaknesses of the organizational design.

6. If you could suggest one major improvement to the organizational design, what would it be?

Module 4 - SLP

Organizational Structure and Culture

For the SLP 4 assignment, you will explore some aspects of an organization's culture, at least as you see it. (Select an organization you have worked with, if possible.) Since the concept of organizational culture is open to many interpretations and classifications, this assessment offers a slightly different approach from your background reading on organizational culture.

Required Reading

Debra Woog McGinty and Nicole C. Moss have compiled a short corporate culture survey aimed at identifying characteristics of workplaces. The categories of workplace description that it generates are fairly self-explanatory.

Assignment

When you have completed the assessment think about it for a minute, and how it compares to the Academy, Baseball Team, Fortress, and Club cultures described by McNamara in the Background reading. Then prepare a 2- to 3-page paper addressing:

· Your scores on the McGinty/Moss assessment and whether or not they fit your general expectations or constitute a surprise in some ways. Interpret the results of the assessment in terms of your own experience, either to confirm or to question the results. Compare your findings with the McNamara categories.

· The degree to which the McGinty/Moss assessment and the McNamara information tell you similar or dissimilar things about your organization.

· Do the assessment and the McNamara categories help improve your managerial understanding and/or skills? What can you infer from the assessment results about how your organization’s culture fits or doesn't fit with you? What (if anything) can you do to make your interaction with the culture more effective?

· Provide your opinion on whether or not the questions asked help you understand the organization and how you cope with it. Do they accurately assess what is needed to analyze a company’s culture?

· Include the actual results to the survey in an Appendix section in your paper.

Module 4 - Background

Organizational Structure and Culture

All background materials (as well as materials referenced on the home page) are required unless designated as optional or general reference materials.

Organizational Culture

Have you ever observed how some organizations just seem to be shining stars in their fields, even if the product or service they produce is not that much different from their competitors? Have you noticed that it seems that they are the ones who are the most successful? Did you ever wonder why? Read the following material on organizational culture for some insights into what culture is, what it does, how it is formed, and how it is taught to newcomers in the organization. This reading is available in the Trident University Library.

Flamholtz, E. & Randle, Y. (2011). Corporate Culture: The Invisible Asset. Corporate Culture: The Ultimate Strategic Asset. (pp. 3-25), Stanford, CA: Stanford Business Books.

This material on organizational culture type may be particularly helpful as you prepare your Module 4 SLP assignment.

McNamara, C. (2000) Organizational Culture. Adapted from the Fieldguide to Organizational Leadership and Supervision. Free Management Library. http://managementhelp.org/organizations/culture.htm

Organizational Structure and Design

The way an organization is designed and structured can have significant effects on its members and its ability to execute its strategy. In this module we will try to understand those effects and analyze the behavioral implications of different organizational designs.

An organizational structure defines how job tasks are formally divided, grouped, and coordinated. According to Robbins and Judge (2014), managers need to address six key elements when they design their organization’s structure:

Work specialization – the extent to which activities are subdivided into separate jobs.

Departmentalization – the basis on which jobs will be grouped together.

Chain of command – the people who individuals and groups report to.

Span of control – the number of individuals that a manager can direct efficiently and effectively.

Centralization and de-centralization – the locus of decision-making authority.

Formalization – the extent to which there will be rules and regulations to direct employees and managers.

One way to gain insight into the complexity of organizations and how organizations are structured or designed is through metaphors. For example, using metaphors, an organization can be talked about as if it were a machine or as if it were an organism. The organization that is like a machine is characterized by extensive departmentalization, high formalization, and limited by low formalization, flat hierarchy and the use of cross-hierarchical and cross-functional teams, free flow of information, and decentralization. Each design has advantages and disadvantages. For example, organizations that are like machines are often good at keeping the costs of standardized products or services down, but could inhibit innovation and creativity. Read the excerpt (pp. 98-108) for insight into organizational design and how metaphors can be used to understand how organizations work:

Cameron, E. & Green, M. (2009) How Organizations Really Work. Making Sense of Change Management: A Complete Guide to the Models, Tools, & Techniques of Organizational Change 2nd Ed. (pp. 98-108). London and Philadelphia: Kogan Page. http://www.bms.lk/download/GDM_Tutorials/e-books/Making_Sense_of_Change_Management.pdf

Organizational structures are also considered in how they fit or align with an organization’s strategy, mission, and objectives. Traditional structures were divisional structures, functional structures, team-based or process structures, and flexible structures. More recently, organizations have needed to take on more “open boundary” designs. Models of hollow, modular, and virtual organizations describe these “open boundary” organizations. Overall, the key learning here is that the structure selected should match the organization’s strategy – or it will be very difficult for the organization to be successful.

The following reading considers organization design in an era of newer strategic considerations such as globalization and changing market dynamics:

Insights@IMD (2012). Organization Design: Inviting the Outside In. retrieved from https://www.imd.org/globalassets/publications/insightsimd/docs/9-organizational-design-final-w.-no.-05.11.12.pdf

Aligning culture and structure

Designing an organization's structure involves more than just shifting boxes and lines on an organizational chart. Mootee (2012) offers several critical tests when considering the adequately designing an organization’s structure:

a. The Future Test: Does the design reflect the needs for how a company plans to compete in the future?

b. The People/Culture Test: Does the design adequately reflect the motivations, strengths, and weaknesses of employees?

c. The Competitive Advantage Test: Does the design allocate sufficient management emphasis to the strategic priorities?

d. The Power Test: Does the design provide the desired allocated power to groups/individuals that is linked to the strategic value of the unit or functions?

e. The Agility Test: Is the design adaptable and swift to respond to future changes? (p. 1)

It makes intuitive sense that organizational culture and organizational structure should affect each other. Indeed, the way work is coordinated, the way hierarchies are designed, and the way communications are channeled should align with the norms and values of the people who work there. If they do not, there will be tension and conflict between the way people feel comfortable working and the structures that force work to be done in a different way. The following article is an excellent and compelling analysis of why management should consciously insure that culture and structure support each other so that the organization can function as smoothly and effectively as possible.

Janicijevic, N. (2013). The mutual Impact of organizational culture and structure. Economic Annals 58(198). Retrieved from http://www.doiserbia.nb.rs/img/doi/0013-3264/2013/0013-32641398035J.pdf

Optional Reading

Organizational Culture

Another classic source for an overview of organizational culture is

Schein, E.H. (2010) Organizational Culture & Leadership. 4th ed. San Francisco: Jossey-Bass. Available in the Trident University Library.

Organizational Structure and Design

“Guidelines for Organizational Design” assembled by Carter McNamara, PhD, provides library links to several readings on the topic.

McNamara, C. (n.d.) Guidelines for organization design. In Free Management Library. Retrieved from http://managementhelp.org/organizations/design.htm

Mootee, I. (2012). What is the right organizational design for your corporation? And what test to use to know if you’ve got the right one? Innovation Playground. Retrieved from http://mootee.typepad.com/innovation_playground/2012/06/what-is-the-right-organization-design-for-your-corporation-and-what-test-to-use-to-know-if-youve-got.html

Robbins, S.P. & Judge, T.A. (2014). Essentials of Organizational Behavior (12th Edition). Pearson.